EWE ELECTRICITY GRID INVESTMENTS GERMANY

The investment programme concerns the renovation, reinforcement and extension of medium- and low voltage electricity distribution infrastructure (underground cables and substations) and the renovation and digitalisation of network control systems. The programme will be implemented in the state of Lower Saxony (Niedersachsen) in northwest Germany in the period 2025-2028.

The project caters for demand growth, the connection of network users, the integration of renewables, and the improvement of the quality of service and the efficiency of operations.

The project concerns standard electricity network investments in a regulated natural monopoly.

The promoter's investment cost plan includes investments in electricity distribution. The project will contribute to maintaining or increasing security of supply in the context of growing electricity demand, from heating and mobility in particular, and growing integration of electricity production from renewable energy sources RES.

The Programme is expected to contribute to Bank's lending priority objectives on Climate Action and Environmental Sustainability and it aligns with the REPowerEU objectives. The financing of the Programme will contribute to the Bank's Energy Lending Policy (ELP) priority on Securing the Enabling Infrastructure (energy networks).

The operation addresses a number of market failures, including increasing security of energy supply, and the integration of low-carbon generation, which reduces carbon emissions and air pollution, with positive climate and health externalities.

The project is expected to deliver a very good economic rate of return and excellent rated social benefit. The promoter is experienced in works of this nature and has a sound project management system in place.

The proposed loan will contribute to the diversification of the borrower's financing sources and thus strengthen its overall financing position. EIB's capability to lend a sizeable loan ticket on good terms will provide substantial support for the promoter's crucial investment plans in its grid. EIB as a long-term anchor investor is also expected to create a positive signalling effect to the capital markets and decrease the borrower's relative exposure to the volatility thereof. The EIB loan's flexible features such as the possibility to tranche disbursements and the availability period provided are considered particularly apt to finance this project.

The Project includes components that may fall under Annex II of the EIA Directive 2011/92/EU as amended by Directive 2014/52/EU, which requires the competent national authority to determine the need for an EIA. The impacts that can be typically expected for some schemes relate to visual impact, vegetation clearance, collision and electrocution of flying vertebrates, electromagnetic fields, noise nuisance, and disturbances during construction, as well as the possible impacts on protected fauna and flora (Habitats 92/43/EC and Birds 2009/147/EC).

The Bank will require the promoter to ensure that contracts for implementation of the project have been and will be tendered in accordance with the applicable EU procurement legislation: Directive 2014/23/EU / 2014/24/EU / 2014/25/EU as well as Directive 92/13/EEC or Directive 89/665/EEC as interpreted by the Court of Justice of the EU, with publication of tender notices in the EU Official Journal, as and where required.